Trader Communications Strategy for a European Bank

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As Trader Voice evolves into Trading Communications the landscape is dynamic. Banks cannot afford to wait for the “right” solution to arrive on the market because the evolution won’t stand still.The technology, regulations, working practices and the core purpose of the trading floor are undergoing change so the strategy needs to aim for resilient flexibility. Our client had slipped behind the curve and was running obsolete systems and equipment.

The Technology Program

The project sponsor had the insight and awareness to know that this engagement needed to have greater scope than a pure replacement program because fundamental changes were required. Working remotely due to the pandemic, our consultants started to gather data from all global locations.

This involved structured consultations with a representative sample of traders, structurers, treasury and sales staff, as well as in-depth discussions with senior stakeholders. We built up a picture of use cases, requirements, frustrations and concerns, which included the challenges of remote working and the effect of old technology on talent attraction.

Trading Communications Technology Discovery

As well as human insight, our discovery process involves sophisticated analysis of system and usage data. By creating a rich database from multiple sources we are able to make informed recommendations on requirements for devices, soft clients and circuits. Detail about users, the calls they make, the lines that are used and system configurations are “enriched” with other available detail including dial tone requirement, speaker, hoot and intercom usage etc.

In this case, we found that many primary and secondary data sources that we normally use were not being collected in a structured way and were therefore unavailable. As a business consultancy, it is not unusual to find that problems exist beyond the limitations of the technology environment and we have the experience to help remediate the situation.

Organizational Structure

It became clear that a “siloed” structure had led to the bank having narrow areas of focus rather than being a cohesive service organization dedicated to the support of its users. In our initial findings, we explained how greater collaboration would be required to support a more integrated technology ecosystem.

Our focus was on making trading floor work-flows more efficient so that users could be more effective and satisfied with their technology. With our understanding of how technology, regulation, core activities and working practices are likely to change, we wanted to identify changes that would make the ecosystem more intuitive and resilient as soon as possible while working towards an optimized strategic vision at the end of a 5-year roadmap. Below, we have listed a selection of important findings from operational and user perspectives.

Key User Related Findings:

  • Voice remains a critical modality for high touch clients, complex trades and high value trades.
  • Speaker requirements demand some physical devices and there are many essential hoots.
  • Text apps including Bloomberg and Symphony are used for the majority of conversations.
  • Trading from home, BYOD and certain apps are prohibited.
  • CRM and Trader Voice don’t integrate with each other or other systems.
  • Multiple order management systems are in use.

Key Operational Findings:

  • Localized deployments have led to increased TCO.
  • Legacy technology causing high exposure to risk.
  • Lack of central management and standards
  • Recordings not fully dependable.
  • Capture is performed locally and rules vary.
  • Retention policy requires greater definition.
  • Lack of SIP and costly internal private wire network.
  • Some users can’t be moved to normal phones from Trader Voice on the current structure.

High Level Recommendations

Central to the proposed solution is the adoption of a “Cloud-First” strategy. As far as possible, hosted services should be used, providing automatic updates, access from anywhere to support hybrid working, and flexible capacity to be adjusted as the workforce grows and contracts. On the strategic roadmap, Trader Voice and compliance solutions will be the first priorities for migration to The Cloud. There will still be physical devices for those who need them but many users will be moved to enterprise endpoints.

Trading Workflow

To improve work-flow, the bank will standardize desktop deployment. Each app used in the trading work-flow will be integrated via CTI and APIs to allow productivity features like click to dial. The integration of voice platforms with MS Teams and a single CRM will be important. Having proved valuable in isolation, video presence will be promoted for contingency and also to streamline on site meetings. Apps like Zoom and WeChat and others that are dedicated to specific asset classes will be integrated in response to client demand.

Trading Floor Compliance

Compliance will be addressed at the technological and policy level. There will be clear direction about app and device usage in a framework that supports hybrid working. Retention policies will be clearly defined to mitigate risk. Critical systems will perform capture and recordings at source while a central, cloud-based solution will ingest data via up to 100 APIs. Existing compliance recordings will also be ingested. While trade reconstruction compliance is the immediate priority, the solution will be able to provide surveillance and business intelligence. In line with the wider cloud-first strategy, new applications will be easily integrated with the compliance infrastructure.

The increased technology integration of the new environment will be supported by a more cohesive service organization. Teams running different aspects of the trading technology ecosystem will align under central management to deliver an optimized, integrated trading floor user experience.

We also proposed network upgrades to support the new ecosystem and the removal of unnecessary infrastructure on company premises. The client will use global SIP carrier architecture for PSTN with number portability within the enterprise voice environment and the global hoot network will come in-house to achieve significant savings.

Achieving Consensus

While it can be straightforward to identify issues in a trading technology environment, it is harder to present a solution that resolves issues of cost and risk with the support of all stakeholders. Our consultancy team had the gravitas and credibility to bring different management teams on board, helping them to accept the severity of the situation while reassuring them that they would be part of the solution. Having reached consensus across divisions and up to CIO level, and having understood the priority of tasks on the strategic roadmap, our client has realised they don’t have the bandwidth to progress the program without ongoing support. Our team will be instrumental in vendor selection, due diligence and the design and engineering required in the implementation program, drawing on decades of experience to help prepare our client for a dynamic future.

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